Cement major, UltraTech Cement reported a marginal drop in its net profit for the third quarter of 2014-15 at Rs. 364 crore (Rs 370 crore) on 15 per cent higher net sales of Rs. 5,490 crore. The company’s operating profit for the period rose 14.6 per cent to Rs. 990 crore.
The Aditya Birla Group Company’s combined domestic cement and clinker sales for the period rose 10 per cent to 10.98 million tonnes. A statement from the company said that on a sequential basis, prices witnessed a downward trend. “However, the ongoing cost optimization measures helped in containing costs despite the continuing increase in price of input material and logistics cost.’’
UltraTech said the business outlook continued to remain challenging and that demand growth in the long term is likely to be around 8 per cent.
Acquisition of Jaiprakash’s Madhya Pradesh cement business to boost capacity
UltraTech entered into a definitive agreement to acquire the cement business of Jaiprakash Associates in Bela and Sidhi in Madhya Pradesh with a capacity of 4.9 million tonnes.
The acquisition will boost UltraTech’s capacity in India from 60 million tonnes to 65 million tonnes per annum. “With the company’s current projects underway, the capacity in India will stand raised to around 71 million tonnes in 2016,’’ the statement said.
UltraTech said that in exchange of the above business, it will issue non-convertible debentures worth Rs. 4,538 crore and non-convertible cumulative preference shares worth Rs. 10 lakh. “As part of the business, the company shall take over Rs. 626.5 crore of debt and negative working capital of Rs. 160.5 crore.’’ The transaction is expected to close in 7-9 months.
On the Bombay Stock Exchange, UltraTech rose 0.68 per cent to close trade at Rs. 3,143.15 on Friday.
